- When you appoint an estate agency to market your home, you can grant one estate agency exclusive rights to market your home (sole mandate) or multiple agencies the right to do so (open mandate).
- A sole mandate means the estate agency that you have appointed exclusively will know that if they can find your buyer, they will be able to close the deal for your benefit and fulfil their mandate. They do this by finding you a willing and able buyer at the price you are looking to achieve. As the estate agency has exclusivity (which agreed to be for a fixed period – known as the mandate period), not only is the agency focused on finding you your buyer and getting you the best price for your home, they also know that they can invest more into marketing your property and spending time to find that right buyer.
- With an open mandate, you have the benefit of a second or more estate agents looking to bring buyers to view your home. That can be a plus if they have a buyer on their books already. The challenge with an open mandate is that the estate agencies can’t afford to spend as much marketing your property, as another agency may be the one to find the buyer. This will leave the other agencies out of pocket. With commissions, you only pay the successful agency.
- Home sellers have a lot more options available to them now, and it’s important to know what those options are before you commence with the sale. You want your realizing your investment to be as profitable as possible.
So you need to know that if you’re a seller and you hire an estate agent to market your home; you have a choice between an open mandate or sole mandate.
What does this mean?
- Sole mandate means you give a single estate agency the sole right to market your home for a fixed period of time, known as the mandate period. You can extend that by agreement, or swap later to an open mandate, if a buyer hasn’t been found.
- Open mandate means you allow multiple agencies to market your home at the same time. The open mandate will also be for a fixed period of time, and you can also convert this at the end of the open mandate to a sole mandate.
Sole mandate vs open mandate: Which is the better option?
Each approach has advantages. Let’s look at sole mandate first:
Sole mandate benefits
By trusting an agency with a sole mandate, you’ll most likely get:
- Strong and dedicated focus from the estate agency in return for the confidence you’ve placed in them to find you that right buyer.
- Greater investment from your appointed estate agency into their marketing campaign for your property.
Open mandate benefits
- If you appoint more than one estate agency to market your home there is a chance that they will have the right buyer already on their books That could lead to a quicker sale, but that won’t always be the case. If the buyer needs to be found, marketing your property is best to achieve that, and there the sole mandate may have the advantage.
Sole mandates can be more effective and are often chosen as the first option. They can lead to a more focused marketing effort upfront and a more personalized approach to the marketing of your property as you and your estate agent are investing more into the relationship. Open mandates also most definitely have their place, and can also be considered.
Looking to buy a property? Get prequalified with ooba Home Loans
Once you’ve sold your property, you may wish to put the acquired funds toward a new investment, or if you’re looking to upgrade, you may need that extra finance.
Getting prequalified helps you determine what you can afford. You can then compare this to the selling price of your home to help plan ahead.
Prequalification also makes it easier to acquire a home loan, as you’ll have proof you can afford the property you apply to put an offer in for.
For more information, contact us at ooba Home Loans, or use our free, online qualification tool, the Bond Indicator.
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